- Ginkgo Bioworks is a company that offers outsourced services in synthetic biology.
- They have a highly automated lab in Boston that allows companies to leverage their infrastructure for cell engineering.
- Their business model is similar to Amazon Web Services, but for biology.
- The company was founded in 2008 and initially bootstrapped for several years before receiving outside funding.
- The founders met at MIT and had a shared interest in synthetic biology.
- They advise considering getting a thesis advisor to leave academia and join the company full-time as a signal of a successful company.
- Biotech companies often bring in professional management quickly, but Ginkgo Bioworks believes in founder-led companies with real ownership.

- The speaker discusses the importance of bootstrap funding and non-dilutive funding in order to maintain control as founders.
- They highlight the role of YC in helping to reduce the cost of starting companies in the tech industry.
- The speaker recommends using Ginkgo's infrastructure for starting a synthetic biology company due to its lower costs.
- They discuss the challenges of fundraising and the importance of authentic belief in the company's mission.
- The transition from being bootstrapped to raising oversubscribed rounds led to a cultural transformation within the company.
- The speaker emphasizes the importance of believing in the impossible and the impact it can have on the organization's growth.

- The speaker discusses the challenges faced by companies in the deep tech or real tech industry compared to those in Silicon Valley.
- They emphasize the importance of having skeptical scientists and engineers in building a culture of innovation and technical risk.
- The speaker shares their experience of finding early customers and advises startups to focus on getting any deal rather than being picky about brand names.
- They highlight the scrappy nature of their company and the lack of respect they receive, but express their dedication to serving various industries.
- The speaker briefly mentions the experience of taking their company public and the excitement surrounding it.

- The company brought everyone to the New York Stock Exchange to celebrate their success.
- They had customers, early investors, advisors, and families present.
- Going public has helped increase their profile and is beneficial for sales.
- Synthetic biology is the idea that DNA is digital code and can be read and written.
- The tools in synthetic biology have improved, allowing for more applications.
- The ability to generate more data and learn from it is exciting.
- Advice for founders is to not underestimate their ability to learn and grow.
- Building a lab is not recommended, it's better to use cloud services.
- Dragons were mentioned as a fun topic.

- The long-term goal of synthetic biology is to make it as accessible and user-friendly as computers have become.
- The speaker believes that biology will eventually become low-cost and distributed, allowing for people to design their own gardens and create beautiful biological designs.
- When asked about advice for women in bio who want to start companies, the speaker emphasizes the importance of not letting gender biases occupy too much mental space and staying focused on the future and maintaining a learning mindset.
- The biotech ecosystem in Boston is known for its drug development, while Silicon Valley dominates in non-pharma areas and cultural product development.
- AI and machine learning have the potential to greatly impact synthetic biology by utilizing large amounts of data, but access to data sets is crucial.
- Ginkgo Bioworks, as a platform company, allocates most of its platform capacity to customer cell programs but also reserves some for internal R&D to improve the platform and develop IP.
- In five years, Ginkgo Bioworks aims to capture a significant portion of cell engineering across biotech applications, including biopharma, ag biotech, and industrial biotech.

- The speaker discusses the potential for centralized infrastructure in biotechnology, similar to the outsourcing of IT departments in the past.
- They believe that in the next five years, there will be a shift from in-house biotech to utilizing a centralized infrastructure, leading to faster advancements and new applications.
- The speaker mentions diverse applications in food, agriculture, sustainability, climate change, metabolic diseases, and gene therapy that have been made possible by improved tools in biotechnology.
- The importance of early employees who can grow with the company and contribute to its success is emphasized.
- The discussion concludes with an appreciation for the contributions of the early team and the importance of their role in carrying the company's culture forward.

Ginkgo Bioworks is an outsourced synthetic biology company with a highly automated lab in Boston. Similar to Amazon Web Services, they offer infrastructure for cell engineering. The company was founded in 2008 and initially bootstrapped before receiving outside funding. They emphasize the importance of bootstrap and non-dilutive funding to maintain control. Ginkgo Bioworks offers lower-cost infrastructure for starting synthetic biology companies. They discuss the challenges of fundraising and the importance of authentic belief in the company's mission. The transition from being bootstrapped to raising oversubscribed rounds led to a cultural transformation. They highlight the importance of believing in the impossible and having skeptical scientists and engineers. Ginkgo Bioworks has taken their company public, increasing their profile and benefiting sales. The long-term goal of synthetic biology is to make it as accessible and user-friendly as computers. AI and machine learning have the potential to greatly impact synthetic biology. Ginkgo Bioworks aims to capture a significant portion of cell engineering across various biotech applications. They discuss the potential for centralized infrastructure in biotechnology and the shift to utilizing a centralized infrastructure in the next five years. Improved tools in biotechnology have enabled diverse applications in food, agriculture, sustainability, climate change, metabolic diseases, and gene therapy. The importance of early employees and their contributions to the company's culture is emphasized.

Reshma and Jason went through YC in the Summer of 2014 with Ginkgo Bioworks. Since then, they’ve become luminaries in the field of synthetic biology, and in 2021, they became the first YC bio company to take their company public. Reshma and Jason still run the company today. Join us to hear more about their founder journey and where Ginkgo Bioworks is headed.

Chapters (Powered by https://bit.ly/chapterme-yc) - 
00:00 - Intro
00:26 - Ginkgo Labs
02:08 - Bootstrapping to Success
03:30 - Finding Co-Founder
05:25 - Tips to Pull People Out of Academia
09:12 - Founder-Led - Biotech vs Tech
13:15 - Why Did you Join YC?
17:53 - What Changed At Scale
22:10 - Building Culture
24:17 - Customers
29:29 - Going Public
31:54 - What is Synthetic Biology?
37:24 - Parting Advice
39:14 - Q&A - Let's Talk Dragons
39:55 - Long Term Goal
41:24 - Women Founder in Bio?
43:30 - Boston vs Silicon Valley?
45:14 - AI and ML in Synthetic Bio
48:01 - Science vs Venture Capital
51:21 - Current Partnerships
52:46 - Outro

Hi, welcome Reshma and Jason and everybody on the call.

My gosh, I am so excited to chat with the 2 of you, pioneers in the field of synthetic biology.

So, to kick us off, the audience today is going to be a mix of people with a tech background and a bio background.

Can you tell us a little bit about what Ginkgo does?

So I'll say it from the tech lens and then from the bio lens.

So from the tech lens, you can think of us kind of like Amazon Web Services, right?

Big centralized facilities that can be accessed as a service so that you can bring your product to market more easily.

In our case, instead of a giant data center like Amazon, it's a highly automated lab here in Boston.

In this building, we're in here about 250,000 square feet of highly automated labs that you could, if you wanted to start a new company and not build out a bio lab, you could essentially leverage our infrastructure to do your cell engineering.

If you're a bio person, in bio pharma there are organizations called contract research organizations, CROs, where people outsource certain types of research.

Traditionally, biopharmas outsource like an animal study or, you know, making a small molecule chemistry to like Wu Shi or to Charles River.

It's kind of like work they don't want to do, basically.

Like, you know, it's kind of like standardized work that it's just like, I'd rather someone else did this.

Our argument to these biopharma companies is Because of our automation and scale, we can do things that they can't do in-house.

So they should actually outsource to us to get access to a scale that isn't available in their internal labs.

But either way, the idea is outsource services, a platform business model like you would see in a lot of tech companies to enable other people's products.

And what year did the 2 of you get started?

And what's the current state of the company?

And then managed to open our first lab in 2009.

And bootstrapped for several years with no outside funding whatsoever.

Until actually our first outside money in was basically part

Class of YC but had been bootstrapping the company for 5 years before that, which is like buying equipment on eBay, like moving into the cheapest part of Boston, like building, getting some guys from South Boston to put in some plumbing into an office space.

It was not the, You know, a lot of biotech start fancy.

That was not the start of Gecko Bioworks, I would say.

But yeah, but I think that served us well, actually, now as we have a lot more capital.

It bakes frugality into your culture from the get go that is even 15 years later is still there.

Scrappiness and resourcefulness, such important lessons for all of the aspiring founders on the call today.

A lot of folks who are wanting to start companies, 1 of the first things they do is they look for a co-founder, you know, and the 2 of you have had such a successful co-founder relationship for such a long time now.

Tell us a little bit about how the 2 of you met and how did you guys know you wanted to work together?

That's 1 of the reasons we work so well together.

The first thing is we want to point out that there's 5 of

And then my PhD advisor is the fifth founder.

And we actually showed up slightly different years at MIT, but all kind of fell in love with what was just getting going as a new academic discipline, synthetic biology.

And so that's kind of how we all met and started working together.

Yeah, we'll talk about what Symbio is in a minute, But I would say in terms of starting a company with your thesis advisor, so like YC obviously sees a lot of companies getting started in the tech industry where it's all just straight out of undergrad, like whatever, boot up a website, boot up an app.

I think for these sorts of hard technology, or deep technology, or real technology, as I would call it, companies frequently are going to have a scientist PhD advisor in the mix.

Like the technology is coming out of a lab or something like that.

And 1 of the things I would advise folks to think about is can you get your thesis advisor to leave the university and join your company full-time?

Tom left MIT and is still at the company today.

I mean, that's hard to do, to pull people out of academia like that.

Because a lot of my bio founders are facing this right now, actively facing this.

I mean, my main view on it would be, I think it is hard, right?

So, A, I think if you're like a venture capitalist and you see that happen, it's actually a really great underappreciated signal of a company that's a big deal, right?

Because those are like, you know, it's a big deal to leave an academic spot.

But if they don't, which is most common, the bigger issue is like, I think there's a weird dynamic that happens in the biopharma space where you have these people who are like, I'm the founder of 27 companies because I'm such and such professor.

It's not founder, it's Y Combinator, we think of founder.

It shouldn't be equity by any stretch of the imagination.

Unless they're leaving, if you want to really build a company with the Y Combinator model, like a Google scale company with founder-led leadership that is not messing around, You don't want to waste that equity and also moral authority on someone that's not joining the company full time.

So it's great to have an advisor as you get something, but it's just different.

I can't tell you how many applications we get at the YC Bio Program, where there's a professor that has 30% of the company.

And then the founders ask me to get on a call with them, with this mucky muck and say, well, can you negotiate them down?

it's super awkward because like, you know, you might not have graduated yet.

So they may be like control whether your PhD thesis goes through or not, you know, so it is like very challenging.

But yeah, if you're spending your whole like, if you're working full time at a company and they're not, that's just a very different level of investment of life energy.

It's in the interest, it's even in their interest to be honest because like again I think YC, God bless, this is why you all like really work.

Like we started Ginkgo in 2008, okay, right?

And like there wasn't even good like founder forward content on the internet.

There was a blog called Venture Hacks that like, what's his name?

You know, who now ended up doing Angel List, like was writing.

And like, we were like voraciously reading these things because everybody else we talked to, it was all completely VC-centric advice.

And so I think the model that Y Combinator pioneered, a big part of it is understanding the power of founder-led companies where there's real ownership, and then that lets it run.

Google, you can't just hire in like a professional CEO from the VC, from how you get Microsoft and Google's.

So if you're a professor, you actually want that equity to be worth something, give it to your students, you know, right?

And take a much smaller piece like that or leave and join full-time, right?

Like otherwise you're just holding it back.

I have been entangled in several of those very fun discussions.

Yeah, they're like, well, obviously the Dix persona is bigger than Y-percent.

You're like, yeah, but there's like 8 fall-on effects to you making that decision.

So, speaking of founder-led companies, Do you think that looks different for biocompanies versus tech companies?

We're sort of fighting this ingrained culture of very quickly replacing the founding team, right?

With so-and-so professional CSOs or CEOs and that sort of thing.

Yeah, I think biotech VCs historically have this kind of tradition of like finding a technology in a lab.

You do probably take the best students and postdocs from that lab and get that started.

But then you pretty quickly bring in professional management in over them.

And part of the reason they can do that is because, like, they're the first money in.

They probably own like 30, 40, 50 percent of the company.

And so but I think if you can flip that model where like if you can bootstrap a little while right or you know get creative about your early funding and rely on non-dilutive funding that gives you a little bit more flex to avoid that model and actually have the founders stay

Then you have to kind of do the typical thing of being on a very steep learning curve as a founder to kind of build the skills you need to run the company yourself, right?

You don't get it by Fiat, you get it because you earned it.

But, but, you know, YC has been sort of helping to like, move the needle on that.

Hasn't happened quite as quickly as it has in tech, but I think it is moving in that direction.

Yeah, 2 things to that, 1 general and 1 self-serving.

So, you know, Ray's pointed out that bootstrapping thing, right?

So Ginkgo, the first $10 million or so dollars in the get go was grants.

We were the first YC biotech company now in support comment.

Back when we were, there was very few straight out of grad school founders.

And so we couldn't have raised venture capital if we wanted to, right?

But consequence, a hundred percent, like the reason we actually, by the time we raised money, we had already created a lot of the value, a lot more leverage in those negotiations.

And so we were able to not have that situation where, well, in order to start this company, it's going to cost $10 million.

I'm not going to give you $10 million for a small percentage of a brand new company.

It's really the starting costs of a biotech that are part of the problem.

I think it's no surprise that like YC came into its own right alongside like cloud computing infrastructure and internet because it dropped the cost of starting companies, right?

And app stores and the whole thing, like all the costs were doing what fell.

And so suddenly there wasn't a gatekeeper who had to give you $10 million to start your internet company, you could start it like, you know, on the first YC deals were like, what what if they give probably like $35,000 or something like it was like, so like that, that was part of why like you've even had a shot because otherwise the gatekeepers were like, well, no, you know, right, like, I'm just not gonna allow it and you had and you needed the money to start an internet company.

So the self serving half, if you are starting a sin bio company, I recommend you use gateco's infrastructure, okay, much less expensive to launch the company.

I think this is 1 of the reasons you don't see founder-led biotech as much.

It's just the up-run costs are too expensive.

So everyone who has managed to pull that off has gone through some crazy scraping and blah, blah, blah on the eBay.

And the last couple of batches, it's felt very different for me, funding companies with $500,000 each versus $125,000.

Of course, it makes a difference if you're a tech company, but especially if you're in our space, that incremental increase means a lot.

Going back to your fundraising journey a little bit, I love the founding story of Ginkgo, of bootstrapping, finding YC, and then doing 2 sizable rounds in close succession to 1 another, right?

So first, after bootstrapping for a while, How did you decide to join YC?

And then what was it like fundraising after that point?

Sam Altman had wrote a blog post that was like, I think YC should, yeah, I'm going to have YC fund things that aren't software companies, okay?

I was like, I don't know him from Adam, but I was like, oh, you know, thank you.

Like, just, I'm like, GitGo is like, you know, like We've been around for 5 years, we're based in Boston, we got like 20 people in a lab out here, wouldn't make sense for YC, but thank you so much for just being willing to apply to someone else to fund bio that isn't trying to develop a therapeutic.

After that, I was like, yeah, we'll do it.

It was like, because that blast went out and like,

That's such a great thing for early founders to hear Because I think sometimes when you put things like that out in the universe, just a thank you, that's what it takes to unlock the power of serendipity.

You just never know in the early days what conversation is going to lead to what outcome.

The other thing I would say is, especially when it's things you just believe in.

I think a lot of what's worked over the years for us has been like back when we were at MIT, it was the beginnings of this field of synthetic biology, which you can think of a little bit like DNA is digital code.

And why don't we bring in some of like the theories of like, you know, computer science and engineering more directly into biology rather than starting with the biology, right?

Like start with the code and then see what can apply to the biology rather than understand how a cell works and work backwards.

And so, so we, you know, we just believe, you know, like Tom and Drew, like, Dr.

Durandy was my boss, like, they really like inspired us to care about this.

And then like, that a lot of Ginkgo success has been just like, making authentic bets on that.

we hired like in terms of like, like decision, but business model, the company like investors, we brought it like it was really like, if you really authentically believe in it, like, just don't be afraid.

You're like, I'm going to do this because I believe it's the right thing to do.

And so your risk tolerance is sort of different because you're just like, well, this is what I believe.

And whereas if you were trying to build a financial model to justify the decision, you might never do it.

Because there's so many hurdles as an entrepreneur that unless you genuinely, authentically believe in what you're doing, you're going to stop at some point, right?

mean you just got to have like a certain degree of like perseverance slash fortitude.

And so believing what you're doing massively makes that easier.

Yeah, there's a lot of people who are far away where we're like, oh, well, we couldn't live with ourselves if we didn't, like, make this bed, right?

Like, you know, like, like, like, you would be, like, down synthetic biology, you know, like, like, that's what it felt like, you know, like, we're like, oh, I'm gonna go through with it, like, you know, like, like, you're so disappointed in us.

It's like, I can't see myself doing anything else.

Remember, the other thing that was brutal, making the jump to taking venture money, it was like, we had just scraped for a long time.

There was a lot of sweat, equity in this thing.

Then it was like, we take all this money and now you're making bets where like, if it's wrong, you're like, you're so far over your skis.

It's like, Oh my gosh, I'm just like, man, you know, the last 6 years were like, like, like, you know, like a lot, you know, if you're applying for grants, you know, if you're gonna get the money, you're like trying to keep employees, they don't really want to stay, you know, like, it's tough, right?

So, so we really felt like we had like, a lot on the line, you know, and I agree with Rachel, like without like really feeling like you were doing it for some other reason, you never would have made it, you would have been too risk averse.

So what did it feel like to make that transition from going, from being bootstrapped to then raising oversubscribed rounds and, you know, 2 rounds in 1 year, right?

So what was it like that changed about that culture?

Well, What I think was an interesting transformation the company went through is like, yeah, we had bootstrapped for so long, right?

So the employees would join us, like they just kind of joined us on faith, I think on some level, right?

Like, and they were like, on some level, just bought into like, hey, yeah, let's give this thing a whirl too.

And all of a sudden, there's this opportunity to kind of build and invest in things that like, we just didn't have the cash to do so previously.

And so it was like, we were like, talking about like, oh, like, we were 20 people, okay, we're gonna be 40 people by the end of the year.

We've been hiring 1 person a year, 1 person twice a year.

We've been just growing so organically and slowly that people like didn't think we could switch into like Like a faster pace of doing things right?

They were just like it's possible like Yeah, and so like we're

Like what how are we gonna be a different company and whatnot?

And like, but what was cool is for all the people who were there at that time, they saw this, like, I thought this thing was impossible, but then we went and did it.

And so that like completely opened their minds to like the possibilities of like tackling the impossible, right?

Because like, again, at some point, you have to like kind of believe like, hey, I can build this muscle, I can like leap off this cliff and build the plane on the way down, right?

And so that, like, going from like, you know, having a scientist or engineer declare something impossible and then you as an organization pull it off.

And then you're like, oh, wow, like I was wrong about that.

And so then all of a sudden, those are, you know, some of the folks who are still here today who are willing to make the biggest leaps because they went through this incredible transformation of thinking we couldn't do something and then we did it, right?

Yeah, and I think it's extra hard when it comes to, for again, I'll say for deep tech or real tech, and what I mean by this is like,

I'll be more offensive than that to Silicon Valley.

But like, I would argue that like, and this is starting to change, like I think some of the stuff that like, you know, I'm not gonna say I'm doing it open AI, some of that, but there was a window where like, the bulk of what Silicon Valley was doing was taking market risk, right?

the money, hire the engineers, get the scooter network, right?

There's no technical risk, not Intel, okay?

know, They will ride them, they will lose them, they will throw them into the ocean.

Whereas, oh, you're going to develop an Alzheimer's drug?

You might try your best, you're not making it and you just might fail because it is scientific and technical risk.

Like you're calling yourself tech as you use software, but no, there's no risk embedded in it.

Okay, you're just you're actually just a marketer, effectively, right?

You're a product developer, and that culture of Silicon Valley.

And so, so, you know, I would argue that all these companies that are building real tech, they have to have good scientists and engineers.

You know what makes a good scientist and engineer?

And so you have this, which is not the case for product.

They're like, you know, the visionaries, the dreamers, right?

But that is not what makes a good drug developer.

A good drug developer is a big time skeptic.

How do you balance those 2 things in terms of building the culture at Ginkgo?

Like having that people side and having that dreamer side and having that business side.

No, it's incredibly hard because you're basically trying to establish an unstable equilibrium where you want to maintain that skepticism, okay?

Because that's how you do rigorous, like, top-shelf science and engineering.

But you also want to have ambition and to have that dream, because that's how you achieve more than you technically think is possible, right?

And so trying to maintain that unstable equilibrium between those 2 very stable states is very challenging.

You need to constantly be protecting that.

And like Rachel gave 1 good example earlier, really high caliber skeptical scientists and engineers who have been through the experience of doing something that they personally thought was technically unlikely and then having it be successful, flips a switch.

Do they get less and less skeptical as they keep beating their own skepticism?

They just get more excited to work on hard things.

Because the trick is, you don't want to lose your skepticism.

That's how you end up with junk science and junk tech, you know, like all those stories you don't want to hear.

See all Y Combinator transcripts on Youtube

YC Fireside: Surbhi Sarna + Reshma Shetty and Jason Kelly - Founders of Ginkgo Bioworks